A large group of developers believe that the introduction of programmability into the Bitcoin blockchain could cause another surge in the popularity of the largest cryptocurrency.
Although Bitcoin is currently viewed as digital gold, with its main use being to store value, programmers say that adding programmability would unlock a range of functionality and applications.
Unlike its rival Ether, which allows the creation of smart contracts and the development of decentralized applications on the Ethereum network, the Bitcoin blockchain does not have the ability to support such functions.
For years, developers have tried to address this limitation by creating “layer 2” networks, such as Lightning, aimed at scaling Bitcoin for payment applications. However, many of these solutions proved unreliable, and the associated bridges used to transfer tokens between networks were vulnerable to hacking, leading to user concerns.
Developers work to improve Bitcoin’s programmability
Despite its lack of widespread use for payment purposes, programmers have recently made progress in improving Bitcoin’s programmability. Projects such as Bitcoin Ordinals, which enable the creation of non-exchangeable tokens by embedding data in satoshi (the smallest denomination of Bitcoin), have paved the way for further progress.
The introduction of BRC-20 tokens , proposed by anonymous programmer Domo, has sparked a search for ways to make Bitcoin even more programmable. Proposals such as OP_CAT, a potential software update to the Bitcoin network, are being considered to facilitate easier implementation of programmability.
Startups such as Arch, which recently raised $7 million in funding, and the Layer 1 Foundation are actively working on solutions to enable greater programmability in Bitcoin. Arch aims to launch a Bitcoin-based application platform, potentially enabling applications to be ported from the Solana network to Bitcoin.
The Layer 1 Foundation is working on a programmable module for the BRC-20 metaprotocol that will enable code storage and execution on the Bitcoin blockchain. These initiatives have attracted the interest of some 20 teams of developers who are developing applications for lending, borrowing, decentralized exchanges, stablecoins and more.
TVL’s value in the Bitcoin DeFi market is $1 billion
Currently, the total value of tokens locked in the Bitcoin DeFi market is about $1.1 billion, much less than Ethereum’s $52.7 billion.
However, Bitcoin programmability advocates foresee a future in which the Bitcoin DeFi ecosystem could compete with or surpass the Ethereum ecosystem, potentially driving significant growth in the cryptocurrency market.
It is worth noting that after a week of consolidation, some analysts have become optimistic about Bitcoin. Leading trading firm QCP Capital expressed optimism about Bitcoin’s price momentum, forecasting a potential return to the $74,000 maximums.
Similarly, technical analyst Rekt Capital believes that Bitcoin has emerged from the “danger zone” after halving and has entered the accumulation phase, as indicated by the weakening of selling pressure.
